If the retiring partner is not paid the full amount due to him immediately on the retirement, how should his capital account be shown in the subsequent balance sheet of the partnership firm?

His Loan A/c

The correct answer is option 3- His Loan A/c.

If the retiring partner is not paid the full amount due to him immediately on the retirement, his capital account is shown in the subsequent balance sheet as his Loan A/c.

The total amount due to the retiring partner which is ascertained after all adjustments have been made to be paid immediately to the retiring partner. In case the firm is not in a position to make the payment immediately, the amount due is transferred to the retiring Partner’s Loan Account, and as and when the amount is paid it is debited to his account.